The Moral Consequences of Economic Policy

Basing his discussion in the historical evidence, Friedman (2005) argues that economic growth has had significant positive consequences for moral development, increasing the relevance of growth as a logical goal for economic policy. This paper approaches the issue theoretically, by developing an evolutionary model of moral behaviour. In this context, there is a critical difference between economic growth driven by technological change, and that driven by policy incentives. The moral development seen by Friedman is the long-term consequence of technological development, but changes in economic policy that increase economic growth may have negative consequences.